Ireland’s property crash could have been avoided

Irish American billionaire Chuck Feeney’s effort to establish the Centre for Public Inquiry to examine corporate and political culture in Ireland was destroyed after political and media pressure was brought to bear.

Frank Connolly, executive director of the Centre, recounts how a massive opportunity to disclose the corruption so deeply at the heart of the Celtic Tiger building boom was missed.

On Sunday 8th August writer and historian, Tim Pat Coogan, opened the annual Parnell Summer School in Avondale, County Wicklow. During his remarks on the state of the Irish media he recalled the forced closure in late 2005 of the Centre for Public Inquiry (CPI) following a prolonged controversy.

He told his audience that the closure prevented the publication of a report into the Dublin Docklands Development Authority and its links to Anglo-Irish Bank whose then chairman, Sean Fitzpatrick, was a board member of both organisations.

Coogan said the report, if published, may have helped prevent the massive exposure of the Irish tax payers to the debt, potentially €33 billion, they face following the corporate collapse of the bank.

The abrupt closure of the Centre for Public Inquiry (CPI) in Dublin in late 2005 prevented the publication of a detailed report which would have exposed serious conflicts of interest at the heart of a State agency – the Dublin Docklands Development Authority (DDDA) - and might have been instrumental in saving the tax payer billions of Euro.

In particular, the report due for publication in March 2006 revealed how the DDDA had been financially, and ultimately fatally, compromised through its relationship with Anglo-Irish Bank whose then chairman, Sean Fitzpatrick, was its most influential board member.

It would also have revealed the deeply unethical business behaviour of Fitzpatrick who has since become the chief focus of blame for Ireland’s collapsed banking and financial system, and of its once booming economy.

If the CPI had been allowed to continue its work it might, conceivably, have rung alarm bells for those in authority to recognise the improper practices at the heart of the banking system and halt the spiraling, bank lending and property debt fueled boom long before the crash and financial melt down two years later.

Fitzpatrick’s close links to the wealthiest and most successful Irish developers – almost all of whom were key donors to Fianna Fáil – placed him at the centre of the most powerful golden circle to emerge in the history of the Irish state.

Many of them were funded by his bank, Anglo-Irish Bank, and many also were investors in the high rise, real estate, opportunities that flourished from the late 1990’s along both sides of the river Liffey at its estuary into Dublin bay.

Set up in 1997 the DDDA enjoyed special planning powers which allowed it to grant lucrative planning permissions (known as Section 25 certificates) on lands it controlled along the city quays without the developers having to go through the transparent, if lengthy, procedures involved in facing objections and appeals from residents or city planners.

After 2002, when Fitzpatrick joined the board of the DDDA, the pace of development intensified and the rate of Section 25 certificates issued accelerated to the extent that most of the country’s small, but hugely wealthy and influential, number of developers were taking options on land in the docklands area.å

The major investments, most notably the massive Spencer Dock development on the north quay, were funded by Anglo-Irish Bank although the other major banks, Allied Irish, Bank of Ireland and Ulster Bank were also quick to join the queue of lenders to a seemingly ‘no brainer’ investment opportunity with land values leapfrogging year on year. Dozens of huge cranes stretching along both sides of the river, lighting the night sky, became the lasting image of the Celtic Tiger years in the capital city.

It became an obvious area of investigation for the newly formed CPI set up with five year funding by Chuck Feeney’s Atlantic Philanthropies in late 2004. Feeney had first suggested to me that such an agency might help expose some of the obvious corporate and political wrong doing in Irish public life.

As an investigative journalist, I had a long track record of exposing political, police and corporate corruption in Ireland. Feeney knew me over several years when I reported on the emerging peace process in Northern Ireland for the Sunday Business Post and dramatically exposed high level political sleaze surrounding the former foreign minister, Ray Burke, who was forced to resign just months into the first Bertie Ahern led government in late 1997.

The CPI board, headed by former High Court Judge Feargus Flood, had a detailed programme of investigations when it received five year funding from Atlantic in December 2004 and its first two reports published the following year - on the development of a hotel within the curtilege of the historic Anglo Norman Trim Castle in county Meath and on the controversial Corrib Gas pipe line in county Mayo - established the quality and intent of its investigative and journalistic endeavors.